Why TV Viewership Keeps Growing

November 30, 2009

Against all gravitational odds, TV viewership continues its inexorable rise. The average U.S. consumer now watches TV 32.9 hours per week, versus 26.3 in 2000, a +20% increase. With the growing presence and ubiquity of the web and mobile, how can this possibly be?

 

TV Viewing -- More Screens, More Content, More Options

Supply Drives Demand

The simple answer is supply.  Consumers now have more places, means and content to view than ever before. It’s a well established fact in many industries that supply can drive demand.

 

  • P&G once learned that Bounty Paper Towel rolls with +50% more sheets lasted only +33% longer.
  • In the food industry, research suggests that the more food a person is served, the more they tend to eat. 
  • Costco’s focus on large sizes is designed in part to drive increased consumption.

And when people have more TV’s, more channels, and more ways to control their viewing, guess what?  You guessed it, they consume more TV.

 

Drivers of TV Consumption

  1. More TV’s to View – Consumer households contain more TV’s than ever. The average household now has 2.8 TV’s, up from 2.4 in 2000. With more TV’s, there are more opportunities to watch.

    More TV's Per Home Drives More Viewership

     

  2. More Viewing Content – The expansion of cable and satellite TV has provided viewers more content options than ever. The average 2008 viewer had over twice the number of choices as in 2000 — 130 channels versus just 61 in 2000.
  3. More Viewing Flexibility – The rise of the DVR has provided viewers greater viewing flexibility. Time shifting is on the rise. Now consumers can record their favorite shows for playback whenever it’s convenient-and it’s easier than ever before. For an interesting take on the impact of DVR’s, see “How the DVR is Saving TV Advertising.”
  4. More Quality Viewing – The introduction of new TV technology (e.g. high definition, plasma, etc.) and digital TV have improved the viewer experience. TV picture quality has never been better.

TV Isn’t Dead

Contrary to what some would have you believe, TV is alive and even growing. What does this mean for Marketers ?

 

  • TV continues to be a core awareness building block for mass appeal brands. Any mass appeal brand which needs to build awareness and brand equity simply can’t ignore TV. It’s broad reaching, it’s efficient, and it’s still effective. Nielsen IAG data shows no significant decline in key advertising effectiveness metrics–awareness, branding, likeability–over the past 5 years. Great TV advertising is still just that – great.
  • Marketers need to focus more on the effect of “context” on their TV plans. Specifically, Nielsen IAG research shows that program context makes a big difference. Ads aired in high engagement TV programs have high recall and vice versa. And matching your brand’s equity to the equity of the program can enhance ad pursuasiveness.
  • TV is becoming increasingly digital and interactive. Already, many brands are experimenting with interactive TV (iTV), and new technology promises to bring web interactivity to your future TV as soon as you plug it in. As well, Marketers need to do more to understand same program/cross-platform viewing–e.g. viewing of the same program across TV, web and mobile.

Where CMO’s Should Focus

The data shows that the demise of traditional TV is way over-blown. That said, CMO’s need to push their brands to innovate in this traditional medium. Opportunities to do so abound. New targeting capabilities, ad and media effectiveness measurement approaches, interactive TV technologies, and cross-platform viewing dynamics promise to challenge Marketers even as they are reassured that TV is far from dead.

 

What’s your brand doing that’s new in TV ?

 

Get free updates of Randall Beard’s Blog by e-mail

 

Get free updates of Randall Beard’s Blog by RSS reader

 


The Ultimate Marketing Ecosystem: What Marketers Need To Know About the Super Bowl

November 23, 2009

Ever hear the saying that the Super Bowl is just an excuse to watch the ads? Well, this year the game will become even less of the focus as Marketers move beyond simply driving ad recall via their Super Bowl marketing activities, and more toward driving consumer conversations and brand interactions that “feed” off of their ads and brand integrations.

In a recent Nielsen Wire post, Pete Blackshaw, EVP Nielsen Digital Strategic Services, and I discussed how the Super Bowl is the ultimate marketing “ecosystem’ of paid media and earned media (Disclosure:  I work for The Nielsen Company).

The Super Bowl is getting real about real-time.

For Marketers, 2010 will mean not only a Super Bowl mega-media buy, but also a new focus on how to leverage that investment into earned media that provides a long tail of consumer driven buzz and brand equity building activities.

Super Bowl Paid Media: How Does It Really Work ?

What should marketers keep in mind when planning their spectacular media-buy?

  1. The entertainment halo matters – Over the last three years, Nielsen IAG research has found that Super Bowl spots achieved +31% higher break-through and +93% higher likability than the typical TV ad. Why? Partly because the Super Bowl has higher than average TV program engagement, but mostly because the ads really are part of the show.
  2. Timing is everything – Ad recall across the game shows that 1st and 2nd quarter spots yield more yardage than second half spots. Fourth quarter spots have the lowest recall and are about comparable to a “normal” TV buy. It’s clear: advertisers should play early and sit on the sidelines in the 2nd half. 
  3. Consumers get finicky – The viewer’s ability to associate the correct brand with the ad as well as reported likability levels wane over the course of the game: 1st quarters are best, 4th quarters are worst. Super Bowl refreshment fatigue, perhaps?
  4. …But as the game continues, good spirits abound – Surprisingly, in-program product placement scores are just the opposite–they grow over time. Branded entertainment recall and brand opinion are lowest pre-game, moderate during the game, and highest post-game.

The bottom line for Marketers? Focus on ads early, and branded integration efforts late. Perhaps most importantly, the Super Bowl is a “touchdown” for brands: the average ad’s purchase consideration increases +13% in the week after the game versus pre-game.

Earned Media: Great Advertising Finds Life in Other Places

How does the Super Bowl shine light on free media and consumer conversation? A Super Bowl  ad may trigger a web site visit, a Google search, a Tweet, fan-page sign ups, or DVR rewind. Or it could bleed over into the Twitter stream of a New York Times or Ad Age reporter. My Nielsen colleague Pete Blackshaw provides another take on maximizing paid and earned media in an Ad Age article “Earned Media May Be Efficient, But It’s Far From Free.”  This whole paid vs. earned issue raises two important questions:

  1. The Impact of Earned Media – Positive playback about Super Bowl ads can provide brands with an almost endless stream of conversation — a “digital trail” of echo-like activities. This free media needs to be considered when brands try to calculate their return on Super Bowl investment. The question is: how can brands best design their “paid” marketing efforts to drive this free digital trail ?
  2. Trail Measurement – Marketers can quantify earned media by volume, reach, tone, source, or even depth of brand advocacy. Much of this can be understood in real-time. Marketers need to understand not just how much, but also how effective it is. And, what effect does “earned” media have on future paid efforts? Is it possible that the digital trail after effects actually produce better ad performance in the future?

Paid Media & Earned Media: Put To The Test

So in the end, it’s not as simple as “buying” high-impact ads and branded integrations at the right time in the years largest media circus–the Super Bowl.

The broader ecosystems matter — and Marketers have to figure out how paid media drives earned, how earned media impacts future paid, and how both of them contribute to building consumer engagement and brand equity.

Get free updates of Randall Beard’s Blog by e-mail

Get free updates of Randall Beard’s Blog by RSS reader



Zapped by Zappos – Learnings from CEO as CMO Tony Hsieh

November 9, 2009

The best CMO is a CEO who believes in Marketing. By this definition, Tony Hsieh, CEO of Zappos.com, must be one of the best CMO’s around. Hsieh, known for his firm’s digital and social networking prowess, had over 870k Twitter followers the last time I checked. I recently talked with Tony after he participated in a “What’s Your Digital?” panel discussion. And what he had to say might surprise you.

TonyHsieh

Tony Hsieh -- The Zappos CEO as CMO

Zapped by Zappos

Before that, however, let me tell you about my own Zappos experience—which is instructive. Seeking a pair of dress shoes for my new job, I went on-line to Zappos, and saw a great pair of shoes on the Mezlan Zappos homepage. I searched for the shoes all over the site — to no avail. Exasperated, I sent Zappos an e-mail, asking: “where are those great looking shoes?” No response. I sent another e-mail, and waited…and waited.

Finally, I received a short e-mail:  “Yes, you’re correct; we don’t carry that particular pair of shoes and will remove the photo from our site.” And they did. In fact, here’s the new picture sans shoes:

Mezlan_Shoes

Mezlan on Zappos - Without the Shoes

This is great customer service? So, I related my story to Tony. He seemed mortified, especially after talking about how much Zappos cares about customer experience. He then followed up to have someone reach out to understand what happened so they could fix it, followed by an offer to send me a free pair of any shoes I wanted. Now, not everyone gets to talk to the CEO about their poor customer experience, but Zappos clearly IS different.

What Makes Zappos Different?

Simply stated, Zappos believes that customer service = marketing. Instead of spending loads of money on traditional (and non-traditional) marketing, they focus intensely on delivering a great customer experience—and recovering from mistakes with grace and humility. Tony believes that “the Zappos brand manifests itself through every employee/customer interaction,” and that brand is a lagging indicator of customer experience. His key points:

  • “The phone is a great marketing tool” – I’m not taking about mobile marketing here. Tony made the point that 5 minutes with a customer on the phone is far better Marketing than any web experience can ever deliver. He loves the phone and bricks and mortar touch points and thinks they are often undervalued by companies.
  • “Culture is our number 1 priority” – Many companies talk a good game about culture, but Zappos actually lives it and uses it as a core part of their business model. Zappos has 10 cultural norms that they instill in employees. They interview for these 10 norms, evaluate employees on them in their annual performance reviews, and let people go who don’t follow them.
  • “Authenticity and transparency are really important” – Tony sees authenticity and transparency (to read more on this topic, see my blog post) as a core part of the Zappos brand. When reporters show up at Zappos, they’re shown the bathroom and lunch-room and then told to roam around and talk to whomever they like. Tony’s daily Tweeting is less about Marketing than it is about him trying to make Zappos more authentic and transparent for followers.
  • “Zappos wants totally engaged employees” – Tony only wants people working at Zappos who are really passionate about the company and delivering great customer service. How much does he believe in this? So much that the company offers every new employee $2k to quit after two weeks on the job – they only want the truly committed.

What About Digital and Social Media?

But isn’t Zappos a social media icon? What about Tony’s almost 1MM Twitter followers? Well, get this: Tony hates the “social media” tag. He says they don’t even bother to measure the ROI of their digital and Twitter efforts.

Further, he’s not a believer in creating marketing “buzz.” Instead, he believes the primary role of every employee is to create “positive customer stories” about their Zappos experience. If they do this–everything else, including buzz, will take care of itself.

Oh, and one more thing. Tony does believe in the importance of “influencers,” but not necessarily the digital kind you might be thinking of. He noted that to this day, when his mom calls, he really listens.

Key Learning’s for Marketers

First, having a CEO who really believes in the brand and customer experience sets the tone for the whole organization. This job shouldn’t and can’t be left to the CMO; it’s the CEO’s job too. The CEO and CMO need to be partners in driving a truly customer-centric, marketing focused organization and business model.

Second, actually delivering a great customer experience, particularly in a service oriented business, comes down to employees delivering each and every time they interact with a customer. Building a culture that attracts the right kind of employee and fosters this kind of performance is just as important as any Marketing program.

Zappos Secret Weapons

These are Zappo’s true secret weapons—their CEO as CMO and their unique culture. So what about my Zappos experience? I like Tony’s description of what employees are supposed to do: “Create positive customer/employee stories.” But what I love most of all is that Tony, as the CEO, does what he says. After all, you just read a story about how Zappos recovered brilliantly from a terrible customer experience. Clearly, Tony knows how to create a good story, too.

Get free updates of Randall Beard’s Blog by e-mail

Get free updates of Randall Beard’s Blog by RSS reader